Ohio’s business taxes are now undergoing a dramatic transformation intended to make the Buckeye State a friendlier place to do business. Seeking a competitive advantage Ohio lawmakers set out to establish the lowest rates in the Midmest eliminating the major taxes on new capital investments and creating an extremely profit driven business climate for companies calling Ohio home. Presently the corporation franchise tax and the tangible personal property tax are being phased out. In their place, a new commercial activity tax (CAT) is being phased in with a broad base and a low rate. Other changes include a 21 percent cut in income tax rates gradually being phased in over five years.